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The following diagram shows an aggregate labour market. The total labour force is illustrated by the N curve, and the aggregate demand and supply of

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The following diagram shows an aggregate labour market. The total labour force is illustrated by the N curve, and the aggregate demand and supply of labour by ADL and ASL respectively. Workers pay income tax as illustrated by the length of the vertical line. Assume sticky wage rates.

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3. The following diagram shows an aggregate labour market The total labour force is illustrated by the N eurye= and the aggregate demand and supply of labour by ADI. ands-{Sr respectively. Workers pay income tax as illustrated by the length of the vertical line. assume sticky wage rates. Number of workers (a) Where on the diagram will be the number of workers that will be employed[ ] (b) Where is the gross (Le. pretax) wage rate paid by employers[ ] (e) Where is the aftertax wage rate (i_e_ take-home pay]I[ ] (d) What is the number unemployed at the pro-tax wage rate[ ] (e) What type of unemployment is this?I Equilibrium fiseguiliiirinm f Both Your answer to {e][ ]

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